Mexus Gold US (MXSG)

[TMLonggun]

Rich, no problem. But bear in mind at best I am an amateur geologist... That said, I think there are signs of value that are so obvious you don't need a geology degree to see or understand.

Here's what I gleaned from the report and from a comparison between the last release and the newest release.

It is about double the size of the last one, repeats a bunch of information with some new tidbits and much better pictures (we even upgraded to colour!).

It basically it reiterates a lot of stuff we already know. Their understanding of the property, aka Mexus' "IP" is steadily increasing. It is an awesome property with historical multiple kilogram gold outcroppings!. For my American friends I will put that in perspective. That's 32.15 troy oz/ kilo so we're talking about stuff in the neighbourhood of 100 oz/mt that you stub your toe on at the surface. If that isn't a great sign of the land's potential then I don't know what is. That even beats some of the legendary bonanzas of old.

To start with it looks like we have enough ore for 3-5 years easy at 6ktpd without any additional drilling or looking outside a small box.

The Julio vein is 800 meters long and has over time, and because of the way the gold quartz was deposited in spurts means it has created a shear zone that has broken apart and mixed up some of the vein material over time. There is probably super high and low grade pockets in an ore field of medium to high grade ore in the area surrounding the veins (the shear zone).

If you have no idea what I am talking about watch these delicious videos to get a visual aid.

"The purpose of this report is to encourage an aggressive exploration stage that will be a short term positive valuation of the resources in the area and eventually a production stage in a no longer than a year time frame because of the outcropping
structures. Vein production from select areas underground could be a simultaneous operation with small tonnage-and bonanza gold values."

Overall it just reconfirms the Mexus investment thesis, which boils down to the fact that we control a known high grade area and enough 1 gram cutoff ore (double the profitable trend's approximate average) to go for what seems like decades. It needs to be drilled loosely (for basic confirmation and boundaries) and placed into production. It's all full of gold. We should just mine it without turning the entire place into Swiss cheese.

If you listen to people like Rick Rule he'd tell you that he is still waiting for "issuer capitulation," meaning that he is offering to finance mines at ultimate low ball, bottom fish prices with a desire for ridiculous full warrants, good for 5 years+. He, and the mines, banks, and others that he symbolizes and represents are offering money and getting deals that are basically 95-99% off, yet they still balk at doing the deals because they are still viewed as risky, and they, the ones the with cash, always want a bigger piece of the pie. Part of this may seem myopic but it is actually an intelligent strategy that they use to mitigate risk and ensure they have ridiculous upside if something ever does go right. As an investor you don't buy every company you see, you buy only the best, and only when they are absurdly cheap (like Mexus). That's what the monied folks are doing and it is all part of the junior cycle. They play chicken for a couple of years while mines mothball and the industry declines setting the stage for supply disruptions of the commodities they produce and stimulating the prices which leads to either the lender or borrower caving and restarting investment in the sector which leads to discoveries, over-investment, and the high prices that ultimately seed the next cyclical decline. The pendulum of fear and greed swings back and forth. The smart companies are already doing deals right now but the sector as a whole will need incentive, like a big discovery or a gold price increase. I personally believe this why whatever JV that was brewing for a year never came to fruition. Paul Thompson is not going to capitulate nor sell us out for anything less than what he believes is fair.

In PT's words:
"Unfortunately, the offers that were received fell short of what the company and shareholders would expect. These offers, if accepted, would have tied the property up for years while the partner company did exploratory drilling with an unknown timeline on production. In addition, the initial investment being asked by Mexus was not being met." -recent PR

"“We believe that our property has a 1 million ounce gold potential. Given that, we are being very careful when considering our options. I appreciate the continued support of our shareholder base and ask for patience during this time. I’m optimistic that we will work something out. We have the property, there is gold, and we have our permits which makes us an attractive partner. That being said, I won’t give away the property"" (july 23rd)

"This report supports our short term goal which is to get the underground mine operation started and to begin a drilling program." (Yesterday)

There are many high grade mines in bad shape and yet there are still profitable mines in the same trend as Mexus mining fractions of a gram. Mexus can definitely make this work.

Placer -> HG UG mine + time/SF money ->3k-6k-10k tpd bulk tonnage heap leach = Mexus shareholder private island.

"I hope our shareholders can clearly see what our steps to full production are. Every person employed by the company is focused on achieving this goal. In addition, I want to thank the shareholder base for your continued support. Your patience and perseverance during this time is appreciated. Getting a mine to production is not an easy task but success in our endeavor will bring great rewards for all involved." -PT Jan 26.

In my opinion (validated somewhat by previous drilling and geological reports) Mexus has one of the most impressive gold properties in the world. If Fresnillo and the other bigs are content to mine their half a gram and low ball us, that's their prerogative. But we won't wait for them.

It is easy to make bold predication when you consider strike length, width, grade and overall tonnage. Mexus almost assuredly has at least two or three million ounces of high grade gold that people will shank themselves in the streets for years from now.

Be patient and stay the course guys.

Take care.